Brazil stocks, real gain on global risk appetite

SAO PAULO Dec 14 (Reuters) - Brazilian stocks opened higher on Monday as news that debt-laden Dubai was receiving help from neighbor Abu Dhabi stoked global risk appetite.

Brazil's benchmark Bovespa index .BVSP tested the 70,000-point barrier, which it has not reached since June 2008. It was up 0.49 percent to 69,604.94 in early trading.

"The (Abu Dhabi) government aiding Dubai World helped the market a lot," said Raffi Dokuzian of Banif Corretora. "Things are also calmer with Greece now."

Abu Dhabi on Monday threw a $10 billion lifeline to Dubai, where news last month of possible debt defaults in the tens of billions of dollars had roiled markets and prompted jittery investors to pull back. For more see [ID:nLDE5BD0FV].

Abu Dhabi's move stoked investor appetite for riskier assets, pushing global markets higher.

Greece has also been moving to reassure the world that the country can handle its fiscal problems. Earlier this month Fitch cut Greece's debt rating, spooking investors.

"We're thinking the (Bovespa) index could break 70,000 today," Dokuzian added.

The dollar slipped in Monday trade, as investors moved away from the safe haven currency. Brazil's real BRBY firmed 0.11 percent to 1.756 per dollar as the greenback dipped against a basket of major currencies .DXY.

In the Bovespa index, heavy hitters Vale and Petrobras were among leaders.

Mining company Vale (VALE5.SA), the world's largest producer of iron ore, added 0.56 percent to 42.93 reais.

State-controlled energy giant Petrobras (PETR4.SA) rose 0.4 percent to 37.95 reais.

"We maintain our 'overweight' rating based on Petrobras's access to reserves, production growth, and leverage to oil prices," noted a Morgan Stanley report dated Sunday.

Brazilian banks also advanced. Itau Unibanco (ITUB4.SA), Brazil's biggest private sector bank, gained 1 percent to 40.40 reais, Banco do Brasil (BBAS3.SA), Latin America's largest bank by assets, moved up 0.45 percent to 30.92 reais and Bradesco (BBDC4.SA) added 0.34 percent to 38.54 reais.

Retailers Lojas Americanas and Lojas Renner gained. Lojas Americanas (LAME4.SA) rose 1.86 percent to 15.86 reais and Lojas Renner (LREN3.SA) climbed 1.56 percent to 39 reais. Data on Brazil's October retail sales are slated for release Tuesday morning.

Yields on Brazilian interest rate futures contracts <0#DIJ:> were little changed on Monday.

The yield on the contract due January 2011 DIJF1 ticked up to 10.35 percent from 10.34 percent. The yield on the contract due January 2012 DIJF2 edged to 11.79 percent from 11.78 percent.

Both were among the morning's most highly traded contracts.

Central bank policymakers last week voted to keep the country's benchmark interest rate, the Selic, stable at 8.75 percent, a rate analysts expect to remain into 2010.

Nevertheless, the question of when the bank will hike rates again has taken on more urgency in Brazil, where economists expect growth next year of 5 percent or more could fan inflationary pressures.

Minutes from last week's meeting are due for release on Thursday morning. The document is typically scoured by investors looking for clues into central bankers' mindsets. (Reporting by Luciana Lopez, Editing by Chizu Nomiyama)